Gold prices continued to head southward as the precious metal shed 1 per cent during late morning trade on Wednesday amidst speculation that the US Federal Reserve will begin a lift-off in interest rates from its September meeting itself, curbing the lure for the bullion as a store of value.

While Fed Chair Janet Yellen stressed last week that she expects a rate hike in 2015, Federal Reserve St Louis President James Bullard said that there is more than a 50 per cent probability of September policy tightening.

Meanwhile, assets in the SPPR Gold Trust, the biggest Gold-backed exchange traded product fell to the lowest level since March 2009, shrinking 0.3 per cent to 1,563.81 metric tons on Tuesday, signaling weakening investment demand for the bullion.

At the MCX, Gold futures for August 2015 contract is trading at Rs 24,645 per 10 gram, down by 1.01 per cent after opening at Rs 24,811, against the previous closing price of Rs 24,897. It touched the intra-day low of Rs 24,624. (At 11:32 AM).